Image via CrunchBase, source unknownTechflash is highlighting the 27 Startups and other companies in the Seattle who are making money off of Apple’s Iphone ecosystem. Earlier in august I wrote that the Apple Iphone and IPod touch presented a great way to stave off the worst effects of what was then the start of the downturn locally. The entire Iphone/IPod ecosystem represents a way to make applications that can tie into your product, like Amazon or Urban Spoon, and help keep money rolling in throughout the downturn, and provide a great service for people.

Urban Spoon’s find the right restaurant using the inbuilt GPS locator in your Iphone has been downloaded 2.2 million times, people are still eating out, and this highlights the usability of the web site, on demand, and just in time for the people who are using the application. Immediate value for the customer, and good for the web site, they can count those users when going for VC funding, they can show success and growth which is what VC’s are going to want right now.

Another hot Iphone application is Big Oven, or recipes on demand, as well as Amazon’s market place application. The interesting part is also PopCap’s Bejeweled game, this is a game I have racked up nearly a billion points on (yes, one billion points, over three years of playing the game). It is also good to see I can has cheeseburger on this one as well; saving off funny cat pictures is one way to share them with your friends when you might not have access to a network in some remote part of the country, or just want a laugh when you are on the bus. Even Microsoft has gotten into the game with the release of a picture viewer for the Iphone. Of course there is also a downside here as well, as bigger players start crowding the market, smaller players might have a hard time getting recognized.

The big question marks are whether large companies will crowd out the small developers, how users will sift through the expanding number of iPhone applications, and whether application prices (many are free) will trend upward or downward, Boctor said. Source: Techflash

Then there is the ubiquitous free download, if someone is using the download to generate traffic for a paying application, like bejeweled then that is one thing. If the entire company is using this as marketing then that is something else, depending on why the company is doing it, competing with free is difficult when cash starved.

What this means is that if you have a compelling application that can address an immediate need, restaurant, cat pictures, shopping or games, then Seattle Startups are doing great. Right now, doing great is something that we need to see more of downtown and in the suburbs. While there is a downside, if you can generate buzz for your application, and compete well in the market, this might offset some of the more egregious issues with the tech downturn right now.

Tags: apple, Iphone, itunes, application store, seattle, techflash, awesome